Investments Roundup: Dynasty, CAIS, Sound Income, HFR, Opto And More

Chris Latham, Managing Editor, Wealth Solutions Report

Q&A With Dynasty CIO Bob Shea – Our Investments Solutions Leader Of The Quarter, And Product News Featuring Allspring Global Investments, CION Ares Management, Hedge Fund Research, CAIS, Sound Income Strategies, Flourish, Opto Investments, AXS Investments And Advyzon Investment Management

Financial advisors and wealth management firms require access to competitive and innovative investment products, solutions and strategies in order to serve their client base. Our inaugural edition of the Quarterly Investments Roundup covers developments in this fast evolving landscape.

We speak with our first Investment Solutions Leader of the Quarter, Bob Shea, Chief Investment Officer of Dynasty Financial Partners.

Other entries this month include Allspring launching an SMA portal, the CION Ares Diversified Credit Fund hiking its distribution rate, HFR reporting that emerging market and cryptocurrency strategies saw growth, CAIS expanding its menu of alts strategies, Sound Income Strategies’ fixed income ETF topping Morningstar’s list, Flourish Cash raising its FDIC insurance coverage levels, Opto enhancing its white-label alternative fund strategies, AXS adding a real estate debt ETF and Advyzon Investment Management adding asset managers to its platform.

1. Sixth Dynasty Investors Forum To Be Held November 13-15 In Nashville

Bob Shea, Chief Investment Officer, Dynasty Financial Partners

Bob Shea joined Dynasty Financial Partners as Chief Investment Officer nearly a year ago to provide a “house view” multi-asset allocation for the approximately 320 financial advisors in Dynasty’s network, as well as to support it with market-relevant thought leadership and content. Shea leads a seven-person team that includes former CNBC anchor Ron Insana, who joined Dynasty as Chief Market Strategist in July.

The firm’s network partners oversee approximately $82 billion in assets, and Dynasty’s asset management platform has approximately $45 billion in assets. We spoke with Shea about market trends impacting advisors and their clients, Dynasty’s outsourced CIO platform, and the firm’s upcoming Dynasty Investors Forum to be held Nov. 13 to Nov. 15 in Nashville, Tennessee.

WSR: What are some of the major market trends impacting advisors and their clients?

Shea: This year has seen approximately seven mega-cap tech names drive almost the entirety of year-to-date market returns, further compounding issues around indexation and correlation. As a result, investors are looking to private markets to achieve less correlated returns.

Since early August, three of the four macro prices I watch carefully have gotten angry, signaling a risk-off alert. The U.S. Dollar Index was up 5%, mainly driven by economic data divergence between U.S. and Europe. Long Rates, or TLT, was down -9% and on pace for a third consecutive annual decline as bond market vigilantes are pushing hard against U.S. debt and deficits. Crude oil was up 14% on supply constraints.

Considering the sharp moves in interest rates, U.S. equities have help up reasonably well, off -6% over this period. All of this signals somewhat of a risk-off environment. Meanwhile high net worth investors might have too much liquidity and would rather trade some of it for excess returns. In fact, we’ve seen an appetite for that among advisory firms on Dynasty’s network.

WSR: How is Dynasty addressing those trends through its outsourced CIO solution?

Shea: The indexation and correlation of public markets have made alpha generation more difficult for advisors. Our OCIO solutions encompass less liquid alts, separately managed accounts (SMAs), and sophisticated mutual fund and ETF strategies. This can empower advisors to grow more efficiently at affordable costs, while spending their time better, on financial planning for clients.

Dynasty also is helping advisors do the proper due diligence and research in the alternatives space. Some advisors in the Dynasty network have no exposure to alternatives, and some advisors have alternative exposures as high as 40%.

In general, more advisors are expressing greater interest in alts than in previous years. This ranges from real estate to private credit to private equity. However, the space still has a lot of room to grow because many advisors have yet to actually put clients in alts.

WSR: What does this year’s Dynasty Investors Forum have in store for attendees?

Shea: This will be our sixth year hosting the Dynasty Investors Forum. We anticipate approximately 250 attendees, including financial professionals on Dynasty’s network and representatives from the Forum’s asset management sponsors.

Last year’s speakers included Blackstone Chairman, CEO and Co-Founder Stephen Schwarzman, as well as Fertitta Entertainment CEO Tilman Fertitta. This year our speakers include Rick Rieder, BlackRock’s CIO of Global Fixed Income, and Marc Rowan, Co-Founder and CEO of Apollo Global Management.

We also have incredible panels on energy transformation and decarbonization, the viability of 60/40 portfolios, alternative investments, seeing past the artificial intelligence hype horizon and Ron Insana will add star power to the Main Stage for us. It’s all going to be exciting, thought provoking and relevant for financial advisors.

2. Allspring Launches Advisor SMA Portal To Customize Client Investment Proposals

Manju Boraiah, Head of Systematic Edge Fixed Income and Custom SMA Investments, Allspring

Allspring Global Investments, an asset management firm with $547 billion in assets under advisement (AUA), launched a custom SMA portal for financial advisors as an extension of Remi, its multi-asset, SMA and direct indexing platform designed for advisors to customize client portfolios. After advisors insert client preferences and objectives, the portal delivers an investment proposal based on the client’s goals, risk profile and tax considerations.

The Remi platform supports active and passive strategies for municipal bonds, taxable fixed income and equities. Its fixed income capabilities include a credit assessment framework and its direct indexing capabilities include indexes covering large core, large blend and large value. Advisors also can move legacy portfolios to customized solutions. Allspring has more than 20 offices globally and more than 460 investment professionals.

“Custom SMAs and direct indexing are some of the fastest-growing products right now, and Remi offers financial advisors and their clients a fully customizable platform with holistic tax management and a simplified transition process,” said Manju Boraiah, Head of Systematic Edge Fixed Income and Custom SMA Investments at Allspring. “Through this new platform, wealth managers can request transition portfolio proposals for all Remi strategies.”

3. CION Ares Diversified Credit Fund Hikes Distribution Rate, Surpasses $4 Billion AUM

Michael Reisner, Co-CEO, CION

CION Ares Management (CAM), a joint venture between affiliates of CION Investments and Ares Management, announced that the CION Ares Diversified Credit Fund (CADC) base distribution rate is increasing for all share classes and that the fund surpassed $4 billion in assets under management (AUM).

The annualized base distribution rate for its largest share class, Class I, reflects a 5.00% increase effective Oct. 1. The new combined base and special yield is 9.35% as of the net asset value (NAV) on August 31. CADC invests in a diversified pool of illiquid and liquid credit investments in a continuously offered interval fund structure. It is distributed through RIAs, independent broker-dealers and wirehouses.

“CADC was launched in 2017, from a belief that individual investors should have access to the entire credit spectrum through their financial advisors,” said CION Co-CEO Michael Reisner. “The success of the fund’s continual asset growth over the last six-plus years speaks to our ability to consistently help these investors achieve their financial goals with the same benefits institutions seek from the range of credit alternatives, including private credit: income, stability and less portfolio volatility through diversification away from public markets.”

4. Hedge Fund Research Emerging Market, Cryptocurrency Indexes Rise Amid Volatility

Kenneth Heinz, President, HFR

HFR reported that the HFRI Fund Weighted Composite Index (FWC) rose 4.5%, the HFRI Equity Hedge (Total) Index rose 6.6% and the HFRI Event Driven (Total) Index rose 5.2% in the year through August. Emerging markets and cryptocurrency indexes also performed well.

The HFRI Emerging Markets (Total) Index rose 5.2%, the HFRI EM: India Index increased 18.7% and the HFRI EM: Latin America Index rose 14.5%. However the HFRI EM: China Index fell -1.4% in the year through August after falling -19.3% in 2022. The HFR Cryptocurrency Index rose 17.9% in the year through August after plummeting -54.0% in 2022.

“Hedge fund performance, dispersion, fee and launch trends in recent months continue to be driven by market cycles of inflation and interest rates – a trend which is likely to accelerate into 2024,” said HFR President Kenneth Heinz. “Surging financial and geopolitical risks continue to define EM hedge fund performance, with managers navigating fluid and volatile market cycles and rapidly shifting sentiment and volatility across equity, currency, commodity and fixed income markets.”

5. CAIS Expands Menu Of Strategies From 12 Alternative Asset Managers

Matt Brown, Founder and CEO, CAIS

CAIS, an alternative investment platform for independent financial advisors, expanded its menu of strategies with launches and additions from the alternative asset managers Apollo Global Management, Ares Management, Bain Capital, Blue Owl Capital, the Carlyle Group, Fidelity Investments, Franklin Templeton, KKR, Neuberger Berman, Nuveen, Partners Group and StepStone Group.

The new strategies ­– which encompass private equity, private debt and real estate – include interval funds, 40 Act funds, business development companies (BDCs) and non-traded REITs, which advisors can make available to accredited and mass affluent clients. CAIS serves more than 32,000 advisors who manage over $4 trillion in network assets. Since its inception in 2009, CAIS has facilitated over $25 billion in transaction volume.

“With nearly 9 in 10 financial advisors set to increase their allocations to alternatives by 2025, asset managers recognize the opportunity within independent wealth management to grow and diversify their investor base,” said Matt Brown, Founder and CEO of CAIS. “We believe the managers who are successfully winning in wealth are following a similar playbook – dedicating meaningful resources to serve financial advisors, creating wealth-friendly investment structures and strategies, and joining the CAIS marketplace for a comprehensive platform experience.”

6. Sound Income Strategies’ Fixed Income ETF Tops Morningstar List For 1H2023

David Scranton, CEO and Founder, Sound Income Strategies

Sound Income Strategies, a Fort Lauderdale, Florida-based RIA with over $2 billion in AUM, announced that Morningstar ranked its Sound Enhanced Fixed Income ETF (FXED) Number 1 in its peer group out of 137 similar funds based on total returns as of June 30, when the actively managed ETF’s total return was 7% net of fees and fund expenses.

It ranked in Morningstar’s top 1% for the first quarter of 2023. The FXED ETF, which emphasizes a blended corporate credit income strategy, has holdings that include BDCs, specialty bond ETFs, REITs and corporate bonds. Its portfolio typically has an approximate equal weighting between investment grade and high-yield debt securities.

“Our FXED ETF was launched in 2020 to help those investing in fixed income securities generate current income while also providing an opportunity for capital appreciation,” said David Scranton, CEO and Founder of Sound Income Strategies. “We are proud of the fund’s performance and its continued ranking in the top 1% of similar funds evaluated by Morningstar.”

7. Flourish Cash Raises FDIC Insurance Coverage On Advisors’ Client Accounts

Max Lane, CEO, Flourish

Advisor-focused wealthtech platform Flourish announced that its cash management solution, Flourish Cash, raised its FDIC insurance coverage through its program banks, which include Citibank, HSBC and PNC Bank. Clients are eligible for up to $2.5 million on individual and business accounts, $5 million for joint accounts, and two-person households will be eligible for up to $10 million in FDIC insurance through a joint account and two individual accounts.

Since the start of 2023, Flourish has added eight additional banks to its pre-existing network. Clients also can earn 5.00% annual percentage yield (APY) on the first $500,000 in an individual or business account and the first $1 million in a joint account, as well as 4.50% APY on the remaining balance. Flourish supports over $3.4 billion in assets under custody and serves more than 600 wealth management firms with over $1.5 trillion in combined AUM.

“With rates expected to remain higher for longer and a renewed focus on the importance of FDIC insurance, advisors have a tremendous opportunity to use Flourish to help their clients safely earn a great rate on their reserve savings,” Flourish CEO Max Lane told WSR. “Advisors consistently are surprised at how much cash their clients were holding in their savings accounts. Flourish is a great tool to pull those assets into the advisor orbit while simultaneously adding more value.”

8. Opto Investments Enhances White-Label Alternative Fund Strategies For RIAs

Ryan VanGorder, CEO, Opto Investments

Opto Investments, a private markets investment platform that helps RIAs access alternatives, enhanced its custom funds capabilities to help RIAs create and manage white-label fund strategies across private credit, equity, real estate, venture capital and infrastructure. The solution includes a due diligence process and multi-manager approach to curating investment opportunities.

Red Bank, New Jersey-based ShoreHaven Wealth Partners, which had over $360 million in AUM as of its latest Form ADV filing, is among the RIAs using the custom funds offering. Opto strives to streamline tasks such as managing capital calls and tax documentation, and provides private markets educational resources for advisors. Its investors include Tiger Global, 8VC, DFO Management, Clocktower Ventures, FinVC and HOF Capital.

“The rollout of Opto’s custom fund capabilities reflects our commitment to supporting advisors and giving them personalized solutions to navigate private markets effectively,” said Opto CEO Ryan VanGorder. “We’re focused on helping advisors to not just compete but to stand out, providing them with avenues to offer unparalleled value to their clients. This new approach is set to elevate the private markets investment experience for advisors and clients alike.”

9. AXS Adds Real Estate Debt ETF Tracking Gapstow Real Estate Income Index

Greg Bassuk, CEO, AXS Investments

Alternative investment asset manager AXS Investments added the AXS Real Estate Income ETF (RINC), designed to provide a differentiated investment for higher yields with exposure to liquid real estate. AXS commenced a partnership with index developer Gapstow Capital Partners to create the proprietary Gapstow Real Estate Income Index (GREI), which RINC will track.

GREI is designed to track publicly traded mortgage REITs (mREITs) that own or originate real estate debt. RINC is equally weighted by sector, with 25% in agency residential real estate debt, 25% in non-agency residential real estate debt and 50% in commercial real estate lending, and mREITs within each sector are also equally weighted. According to AXS, this equal weighting makes RINC unique among ETFs providing mREIT exposure.

“As investors seek higher yields, many have become overly reliant on corporate junk bonds, which can bring risks with regard to their quality, duration and ties to the corporate credit cycle,” said AXS Investments CEO Greg Bassuk. “With RINC, investors and advisors now have the ability to diversify the high-yield sleeve of their portfolios and complement a broader real estate or alternatives portfolio with unique exposure to the credit side of real estate and an alternative to high yield corporates.”

10. Advyzon’s TAMP Adds Fidelity, Alpha Vee Solutions, KKM Financial And Zacks

Meghan Holmes, COO, Advyzon Investment Management

The turnkey asset management program Advyzon Investment Management (AIM) added the asset managers Fidelity Investments, Alpha Vee Solutions, KKM Financial and Zacks Investment Management to its platform. AIM, which launched in March 2022, now makes more than 150 strategies from 20 asset managers available to financial advisors through its Nucleus model marketplace.

AIM provides active/passive mutual funds and ETFs, a tax-sensitive ETF-only solution, an ESG active/passive model, an alternative model, direct indexing, as well as tax optimization and tax loss harvesting tools. The TAMP is accessible through Advyzon’s cloud-based platform that combines portfolio management, performance reporting, trading and rebalancing, client web portals, client relationship management (CRM), client billing and document storage.

“Our recent additions and enhancements have allowed us to provide easily accessible investment services within a fully integrated single platform that already serves as the technology hub of an advisor’s business,” said AIM COO Meghan Holmes. “This eliminates the need for advisors to contract with outside managers or go to yet another platform for investment management services.”

Chris Latham, Managing Editor at Wealth Solutions Report, can be reached at

Related Posts

Sign Up for Our Newsletters

Sign Up for Our Newsletters